When ICE agents raided the construction site of a burned property in Altadena earlier this month, they made no arrests. The man they were after was not there. But the mere specter of them returning spooked the workers enough to bring the project to a temporary halt.

The next day, half of the 12-man team stayed home. The crew returned to full strength by the end of the week, but they now work in fear, according to Brock Harris, a real estate agent representing the developer of the property. “It had a chilling effect,” he said. “They’re instilling fear in the workers trying to rebuild L.A.”

Harris said another developer in the area started camouflaging his construction sites: hiding Porta Potties, removing construction fences and having workers park far away and carpool to the site so as not to attract attention.

The potential of widespread immigration raids at construction sites looms ominously over Los Angeles County’s prospects of rebuilding after the two most destructive fires in its history.

A new report by the UCLA Anderson Forecast said that roundups could hamstring the colossal undertaking to reconstruct the 13,000 homes that were wiped away in Altadena and Pacific Palisades on Jan. 7 — and exacerbate the housing crisis by stymieing new construction statewide.

“Deportations will deplete the construction workforce,” the report said. “The loss of workers installing drywall, flooring, roofing and the like will directly diminish the level of production.”

The consequences will spread far beyond those who are deported, the report said. Many of the undocumented workers who manage to avoid ICE will be forced to withdraw from the labor force. Their specialties are often crucial to getting projects completed, potentially harming the fortunes of remaining workers who can’t finish jobs without their help.

“The productive activities of the undocumented and the rest of the labor force are often complementary,” the report said. “For example, home building could be delayed because of a reduction in specific skills” resulting in “a consequent increase in unemployment for the remaining workforce.”

Jerry Nickelsburg, the director of the Anderson Forecast and author of the quarterly California report released Wednesday, said the “confusion and uncertainty” about the rollout of both immigration and trade policies “has a negative economic impact on California.”

Contractors want to hire Americans but have a hard time finding enough of them with proper abilities, said Brian Turmail, a spokesperson for the Associated General Contractors of America trade group.

“Most of them are kind of in the Lee Greenwood crowd,” he said, referring to a county music singer known for performing patriotic songs. “They’d rather be hiring young men and women from the United States. They’re just not there.”

“Construction firms don’t start off with a business plan of, ‘Let’s hire undocumented workers,’” Turmail said. “They start with a business plan of, ‘Let’s find qualified people.’ It’s been relatively easy for undocumented workers to get into the country, so let’s not be surprised there are undocumented workers working in, among other things, industries in construction.”

The contractors’ trade group said government policies are partly to blame for the labor shortage. About 80% of federal funds spent on workforce development go to encouraging students to pursue four-year degrees, even though less than 40% of Americans complete college, Turmail said.

“Exposing future workers to fields like construction and teaching them the skills they need is woefully lacking,” he said. “Complicating that, we don’t really offer many lawful pathways for people born outside the United States to come into the country and work in construction.”

A home under construction in Altadena, where immigration agents visited earlier this month.

(Myung J. Chun / Los Angeles Times)

The recently raided Altadena project had plenty of momentum before the raid, Harris said. The original house burned in the Eaton fire, but the foundation survived, so the developer, who requested anonymity for fear of ICE retribution, purchased the lot with plans to rebuild the exact house that was there.

Permits were quickly secured, and the developer hoped to finish the home by December. But as immigration raids continue across L.A., that timeline could be in jeopardy.

“It’s insane to me that in the wake of a natural disaster, they’re choosing to create trouble and fear for those rebuilding,” Harris said. “There’s a terrible housing shortage, and they’re throwing a wrench into development plans.”

Los Angeles real estate developer Clare De Briere called raids “fearmongering.”

“It’s the anticipation of the possibility of being taken, even if you are fully legal and you have your papers and everything’s in order,” she said. “It’s an anticipation that you’re going to be taken and harassed because of how you look, and you’re going to lose a day’s work or potentially longer than that.”

De Briere helped oversee Project Recovery, a group of public and private real estate experts who compiled a report in March on what steps can be taken to speed the revival of the Palisades and Altadena as displaced residents weigh their options to return to fire-affected neighborhoods.

The prospect of raids and increased tariffs has increased uncertainty about how much it will cost to rebuild homes and commercial structures, she said. “Any time there is unpredictability, the market is going to reflect that by increasing costs.”

The disappearance of undocumented workers stands to exacerbate the labor shortage that has grown more pronounced in recent years as construction has been slowed by high interest rates and the rising cost of materials that could get even more expensive due to new tariffs.

“In general, costs have risen in the last seven years for all sorts of construction” including houses and apartments, said Devang Shah, a principal at Genesis Builders, a firm focused on rebuilding homes in Altadena for people who were displaced by the fire. “We’re not seeing much construction work going on.”

The slowdown has left a shortage of workers as many contractors consolidated or got out of the business because they couldn’t find enough work, Shah said.

“When you start thinking about Altadena and the Palisades,” he said, “limited subcontractors can create headwinds.”